How much trouble is Rachel Reeves in over rental rule break?
Well, at least nobody is asking Rachel Reeves about tax hikes today. Not that this will be a pleasant episode for the chancellor. Her refusal to apply for a selective license before renting out her family's house is at least alarming. But is it more than that? That's a question that can be answered on a variety of fronts: political, economic, and legal. Let's start with the ethics, particularly ministerial ethics. All government ministers are expected to follow the ministerial code, a 34-page paper on public life that specifies minimum requirements. A breach of the ministerial code can often result in the resignation of a minister, including Angela Rayner, the former deputy prime minister, less than two months ago. That's why the reversal of letters between Reeves and Sir Keir Starmerjust before midnight was so vital, and that Downing Street was not keen to wait for the morning. The prime minister said he had consulted Sir Laurie Magnus, the Conservative-appointed independent ethics advisor whose unflinching role for Rayner and several other ex-ministers, in addition to that, and that no further probe was required. Sir Keir said the breach was inadvertent, that Reeves had responded promptly to rectify it by applying for the licence and had apologized. Sir Keir wrote, "The ministerial code makes it clear that in some circumstances, an apology is a proper resolution. He may not have been more specific in terms of the prime minister's argument that Reeves' position as chancellor is not in question here. That said, a big question remains.
Is it true that the prime minister's position was that his chancellor did break the ministerial code, but that the apology is a good start? Is it true that the apology is sufficient for there not to be an inquiry into whether she broke the ministerial code? This may be niche, but it doesn't matter - the chancellor breaking the ministerial code in any way, although minor, is worth noting. Of course, the political implications of this will be much less academic than political. The Conservative Party smells vulnerability. A spokesperson said,
Keir Starmer promised to restore political integrity to politics, but now he's laughing in the face of the British people. He should have a backbone and sack the chancellor now. "However, Kemi Badenoch seemed to marginally muddy the situation this morning, implying that Reeves should only be fired if she is found to have violated the rules. A lawsuit that Starmer fired his chancellor is not par for the program. In fact, this is the first time the Conservatives have called for Reeves' stewardship of the economy over the past 16 months or so. It's a critical strategic decision that they have made.It's one rule for the Chancellor and another for everybody else.
Potential fine
As pungent as our political discourse may often be, calling for a sacking brings the totality to it. That's a card the Conservatives have now played. Some in Labour this morning believe this is a histrionic overreaction by Kemi Badenoch's party, which will considerably reduce the bar for ministerial dismissals. Nevertheless, the Conservatives insist they will make the most controversial charge in politics stick: one rule for them and another for the remainder of us. It's likely that whether they are correct or incorrect will have a large part to all this. Is Southwark Council going to take action against Reeves for not having the correct licence? We don't yet know. Would they take steps against other people, non-politicians, who are involved in this situation? We don't know yet what we're looking for in this particular segment of housing law, but we't yet know, although we'll find out. In the fiscal year 2023-24, 245 councils had levied fines totaling £2, according to a Freedom of Information request by Direct Line Group in 2024. 5m for non-compliance with selective licensing rules. Fines levied in different areas of the country can vary greatly between different regions. The Housing Act 2004 was section 95. If the landlord has a rational explanation,
it could be a criminal offence not to have the right licence as a landlord. Moreover, reports close to the chancellor have denied that her letting agent told her it would warn her if a restricted licence was needed but did not do so. Is this really a valid excuse in the eyes of the authorities? We don't know what we're looking for, but experts are trying to get an answer.
Political judgement
Aside from those technological aspects, the chancellor's danger is that this episode unfolds into deeper, pre-existing questions about her personal and political wisdom. Is it prudent enough to double-check the licensing situation for herself? Is the individual, who is too young to be chancellor in the midst of global economic turmoil, smart enough to check the licensing status? Not least because she had endorsed the introduction of selective licensing in her own Leeds West and Pudsey constituency. These are the kinds of questions that may be asked. Labour MPs had a deep and persistent belief in Reeves' decisions on topics both large and small before the general election. Labour's campaign, as an economist and an individual, was at the forefront of Labour''s election campaign, with the ability to persuade the public to trust the party again with the public budget. After a turbulent period in office so far, it is clear that your image is under attack like never before. And if this growth slows down as an embarrassing but fleeting row, the Budget still looms. Subscribe to our Politics Essential newsletter to stay up to date with Westminster's internal workings and elsewhere.
